Posted
by
timothy
on Sunday September 30, 2012 @10:48PM
from the but-who's-counting dept.

First time accepted submitter abhi2012 writes "Noah Kagan, a former Facebook product manager, has written a brutally honest article about how and why he got fired from Facebook in 2006 and what he learned from it. The experience must be particularly painful, given that it eventually cost Kagan a $100 million fortune."

Facebook took the old adage from the late 90s: Attract eyes and ears then you'll make money somehow.

Nowadays there are ad networks that you can cash easy with this, but back in Google's time, it was like the underpants gnomes equation.

The irony is Classmates.com was first on the scene for meeting your fellow highschoolers, but they charged you for the privilege!

This teaches us one thing: Don't put any barriers in your website for adoption, even if the barrier is a paywall to profit you in the short run.

I think this is why freemium games are coming into their own. You have more people playing, money from ads and some money from premium good sales, and if your game is good, more people will come play it than a traditional 60$ game.

typical marketer perspective. things that cater to the masses are the most watered down boring cliche products possible. No one bothers with the niche anymore and that's too bad. That's where the interesting things hide.

There's money in niche products, but things like broad social networks are not built on niches. When you have a social network, you either get as many people on it as possible, or you alternately find a smaller group who is willing to pay and capable of paying. This is not an easy task. And if they pay, you'd better have some first class service and content, preferably service because content these days is pretty easy to copy unless you are marketing something with a short shelf life.

Something like Facebook was started for college students and spread to everybody. They did what they needed to do, which is market for mass appeal. I can't argue with what they did, although I do wonder how far they can take it. The craptastic IPO was just another signal that FB needs to do something or it may not fare so well in the near future.

Well, niches are exactly why Facebook and Google want as much data from you as possible. In hindsight their business models should actually encourage all sorts of niches, because a big problem getting in a niche market is not knowing how to find the right customers. They are more likely to seek help from these data-mining advertisers, and they also pay more per click. Niches, both in terms of demand and supply, is probably essential to their business. The problem you state is in the unimaginative that only

I love that people keep saying this like it's correct. No. They are not in the business of slavery. Grow up.

They sell advertising space. That's it and that's all. Same as a newspaper, same as a TV show, same as a magazine, same as Slashdot. There's no reason to try to make it sound more evil than it is. They just do it better because they know you're (probably) between 30-40 and like automobiles.

they also track your cookie trail.. that's different than being pitched at a grocery store..at least before they started handing out those scanners that track your movements through the store while pretending to be a convenience.

Then don't browse sites with the "like" button. In order for the like button to work on a website, you must first authenticate. To make this transparent, it's done via a cookie and the site must also authenticate.

From that info, FB gets to see which account you are and which site you've loaded. FB created this feature, end users love it, and web devel are using it. FB does not force this on anyone.

I think you must be an optimist: They're no *less* evil than television networks, newspapers or Slashdot. (TV shows are sold to TV networks, i.e., the TV show is the product.) When organizations like this are private they (potentially) *can* retain the goals of their founders, but once they're public (and they're founders sell off their stock), they're *required* to try and make the biggest profit possible. They do this by selling certain demographics of eyeballs to certain advertisers. The user's attention is the product.

The purpose of a corporation can be for things other than to "maximize profits and increase shareholder equity" (a typical phrase in many corporate charters). A really good example of a corporate charter that has other purposes is Ben & Jerry's Ice Cream, which explicitly put social progress and other corporate goals besides making a profit into its corporate charter.

If you are an investor and have not read a prospectus about the company and especially if you don't have a clue what the goals and corporate charter have to say about that company, you are being foolish in even investing into such a company.

I know of one particular company (I won't bother naming it because this was said informally) whose express purpose is to provide full employment for the citizens of South Dakota. Another company (Fortune 500 and traded on the NYSE) has in its corporate charter to act as a beneficiary to the development and welfare of a smallish Mid-western town in America. There are also a few corporations that have been established "to spread the gospel of Jesus Christ" or to promote science and other various purposes that have nothing to do with making a profit. Elon Musk, in the case of SpaceX, openly admits that the purpose of his company is to "make mankind a multi-planetary species". The "Newman's Own" company also has a strong charitable mission where none of the profits are even given to shareholders.

In some cases (like SpaceX) earning a profit is certainly very useful and helpful to the ultimate goal so it doesn't even hold that the company must be a "non-profit" company to have purposes other than maximizing profit. If a company fails to meet the overall purpose of the company, it could be argued that the fiduciary responsibility of the board of directors and the corporate officers has not been met, even if perhaps they are maximizing profits.

I agree with you in general that it does not say "try and make the biggest profit possible." But it does say something close to that.

Close to it != it.

Lots of corporations make donations in cash or other resources to charitable causes. If your original assertion was correct then the officers of those corporations would be breaking the law by doing so.

You were wrong, and you got called on it. Now just shut the fuck up already and in future check your facts before repeating shit you read on teh intarwebs.

Sure. And yet they're paying me (in free services I use to interact with my friends and acquaintances) in order to monetize me. If that payment ceases to motivate me to put myself in a position to be monetized then they lose.

On the other hand, know that creating favourable conditions for the lettuce is in the best intrest of the farmer. So it's a win-win situation. You watch ads, you get a service.Fair and suqare until you confuse yourself with a customer.

Slashdot does not require me to link my account to others as part of the deal. Slashdot has no interest in my physical location. Slashdot does not track me on a multitude of other websites (OK, maybe a few that have/. buttons). Slashdot allows me to remain pseudonymous and still access the full range of non-subscriber features. Slashdot allows ACs. Slashdot has content that is generally of interest to me. Nobody on Slashdot knows who I really am.

This is why I have a Slashdot account and why I have never signed up to Facebook.

I think the scary thing is that there are still so many people who genuinely don't know.

They provide free time-wasting software to you, and encourage you to tell them all about you. and your friends. Information about you is the product.They sell info about you to advertisers and businesses. They are the customers.

Will they make enough money to become a long-term stable business before Twitter and/or the Next Next Next Big Thing (TM) steals all of their thunder? Will Justin Timberlake resurrect MySpace,

I'll echo some of the same sentiments others are posting here in that I don't know what he really did at FB but given the information on the site above, here are some highlights:

Internship at MS in 2003 for ~3 months during the summer before his Senior year; the experience definitely looks like he took a few liberties describing his responsibility.Bachelor's in business administration and economics from UC Berkeley in 2004Moved on to Intel from 2004-2005; again his experience looks a bit exaggerated. I don't doubt there is truth to it but in my opinion, the way it reads gives the reader the impression his responsibilities were much more than they actually were.Moved on to Facebook in October 2005 until he was fired in June 2006. For those keeping tabs, that is less than 1 year of experience at FB. Furthermore, the experience he lists has a lot of what I would consider technical in nature yet he does not have a Comp Sci or related degree. Given the liberties I feel he has taken with his other experience, I don't think this one would be any different. If he helped market facebook during its infancy then he should be marketing that (hah) a lot more than "his" experience with these technical items.

At the end of the day, he joined Facebook with about 1 year of actual work experience under his belt and he got fired from Facebook after having worked there less than 1 year. Did he lose out on $100M other than what he feels he would have eventually worked up to had he been there until the IPO? Not a chance.

He is showing regret that he should have learned these lessons before he screwed himself out of this kind of money. I didn't see anything in that blog post that suggested he was "cheated out of the money" and indeed suggested that he really wasn't fit to be getting that kind of money... at least with the skill sets that he had at the time he was fired. In fact, he even goes so far as to express that if the him of here and now was in charge of the him of then and when, that he would have fired himself in nearly the same way (perhaps more diplomatically, but it would have still happened).

I've been in some of the same position more than a couple of times, where I made the wrong decision in my career where had I been able to take the skills I have today and have been in the position I was at elsewhen, I would have been a multi-millionaire myself. No real regrets, and I've learned those lessons over time. My hope is that other opportunities will arise that I can take advantage of and hopefully not screw up if it comes up again.

Do you hate your job? Are you only still there because you're waiting to vest? I feel your pain, brother. The only thing that kept me from leaving Netscape in 1997 and walking away from a dumptruck full of cash in frustration was this script. I ran this every morning for at least a year: it prints out the following motivational message:

Today's NSCP price is $__._; your total unsold shares are worth $____. You are __._% vested, for a total of ____ vested unsold shares ($____). But if you quit today, you will walk away from $____.
Hang in there, little trooper! Only _ years __ months __ days to go!

It's amazing how this script can put it all back into perspective and keep you from going postal and strangling someone. Fill in your numbers, and let it remind you not to do something you'll regret later.

In the event of a pre-IPO company, it should also include the difference in a competitive salary vs current salary (and reasonable bonuses or raises) for the duration it will take before vesting occurs and insert "You're paying $____ for the possibility that you will cash out big." Just to put that in perspective.

I actually mostly read TFA. This guy sounds like an asshole, but at least he does a decent job admitting it. For those of you too impatient to slog through it, he basically says "I was a product manager but I wasn't very good at product managing" and "I used the brand more than I added to it" (w.r.t holding parties at the office, self-aggrandizing on his blog about working at FB). Not to mention going behind people's backs, like all of Marketing, on a new feature.

Short version: I was a liability, and they fired me for it. At least I learned something.

Get over it already... you didn't lose $100m... you were a momentary employee of facebook, where had you stayed for 10x longer, and your share wasn't diluted, and etc etc etc.. you might have made $100m.

Anyway, the lessons he learned don't worth 100M. Almost everyone learn them for free. Nothing special in this story at my humble opinion. Everyone with about 5 years at the workplace got these lessons. I estimate that 5 years is the average time to be fired these days.

It's pretty funny that he says one of his mistakes was using Facebook to promote himself and that he learned not to do that. That he should help build something and the publicity comes as a consequence of that. And here we are, 6 years after he left Facebook, reading about him and Facebook.

I wouldn't say he is an asshole. I'd say he's someone who made some mistakes when he was younger, lost an absolute fucking fortune over it, and then did something unusual (for assholes) - he conducted a brutally honest self-assessment, used it to make himself better, and bared it for the world.

The only lesson he learned was that it's better to be the bigger asshole and let it rain down on the people underneath you. Note that he's now all about being the shitcanner rather than the shitcannee.

The argument against that is how the Soviet Union simply didn't have any sort of system in place to identify and find a suitable replacement. With 300 million people in the Soviet Union, it would seem that somebody somewhere should have had at least the aptitude to take the place of Korolov. The tragedy was that due to politics, war, pograms, and general corruption such an individual simply couldn't be found when it was needed.

There were also other reasons why "the USA won the Moon race" that had nothing

There is not a single job someone is doing right now that somebody else couldn't do.

My job is not particularly special or amazing, but there are only about 10 people worldwide who could walk in and do it straight away with comparable quality to the way I do it (and I know all of them; and since they're all already doing basically the same job, but somewhere else, they couldn't just jump in and replace me).

There are of course millions of people who could walk in and start doing it with 3 to 6 months of hard-core study. It's not special; or amazingly difficult; it's just that my job require

You have a "boat anchor." You are invaluable until the day the company decides to move, then you are a liability.

Yes and no... since the chance of us replacing ALL our proprietary technologies simultaneously is basically zero (breaking backwards compatibility on our software to our hardware would be VERY painful to the company), we tend to migrate slowly from one to another, phasing one out as we phase another in.

I'm the guy who learns the new one as it gets phased in, so the only way I'm getting fired is if we hire someone new as we phase in new technologies, then I get fired after the last technology that I was resp

I don't know why we care about this guy, but he took firing pretty hard. Who doesn't? As he said, Facebook had an important part in his life, from the article:

At that time, here’s the order of what was important in my life:
1- Facebook
2- Myself
3- Food / Shelter

OK, it sucks the get fired, but he lied in that list above, in reality he actually put himself above everything, and really abused his relationship with Facebook. As he later admits:

I wanted attention, I put myself before Facebook. I hosted events at the office, published things on this blog to get attention and used the brand more than I added to it.

Add to that he wasn't paying attention at all in meetings (well, I don't blame him for that but sometimes meetings are important), he didn't work well with others, and eventually he just annoyed the wrong people too much.

The single best take-home message in the post is nothing new, but have you truly internalized it? You are replaceable, and firing you would hurt you much more than the company. I work in research and it's even worse: whenever somebody leaves, nobody even bothers to carry on the work they'd been doing. What does that mean?

There are more reasons to stay at a company than just money. I make enough money to satisfy me (more than anyone in my extended family, actually), and there are other things that make me happy. But it won't bother me at all to get fired, because I've been through that and know how to find other work.

The single best take-home message in the post is nothing new, but have you truly internalized it? You are replaceable, and firing you would hurt you much more than the company.

Generally, no. People are not replaceable. When you try to replace one person with another person who on paper seems to be equivalent, you will end up changing the company. At low-levels, the effect will generally be localized, although even at this level the Butterfly Effect can come into play. As you move up the pay scale, switching personnel can have more and more noticeable effects on the company. What role they are in tends to have different effects -- switching out people in a role of creating value for the company can change the company's value in an extreme way. Replacing middle managers tends more to have a multiplier effect on the value creators. And then there is the social dynamic one brings, which can cause huge problems within the company organism.

I think an equivalency to your statement would be: you have no job security. And from an employer perspective: you have no security in retaining the people who give your company value. When either of these parties take those statements for granted, one or both parties will hurt from the loss.

Yes each person brings something different to the job. Often so different that I am at a loss to say whether one person is "better" or "worse" than another who is at least in some sense their predecessor. And you know what? Maybe Facebook would now be worth $104,001,000,000 instead of $104,000,000,000 if it had not fired Noah Kagan, and firing him was a mistake. Then again maybe not. There is no way of knowing and nobody at Facebook cares. That is what replaceable means.

Yes, you're right it's impossible to know because we will never see the alternate timeline where this guy wasn't fired and he continued to be a douchenozzle at FB. His continued presence there might have had no impact, or might have put their efforts to expand in disarray. In a position that was more crucial to the company -- say, the guy in charge of keeping the servers from being crushed as the user base increased -- the What If might be more severe.

There isn't really a how here—just (rather gamy) reflections on possible "why"s. The piece is not really very good at generating sympathy, either; the author comes across as erratic, impatient, and insecure—more than a little like a stereotypical teenage girl in disguise. Perhaps the true lesson is that marketing is a strange, shallow world. (And more importantly, why doesn't the blog article mention any attempts at intervention before he was let go? Do they just randomly axe underperformers at FB, or was that another critical part of the coherent thinking process left out of the story?)

why doesn't the blog article mention any attempts at intervention before he was let go?

That's what I was wondering. From the sound of it, things went from hunky dory to gone in 60 seconds. Weren't there any warnings? Don't people communicate at FB? (Extremely ironic, that.) That end run around marketing, a instance in which communication was very badly handled, sounds like the likely reason, and could justify an immediate firing, but we can only guess. Zoning out at meetings is bad too, but not necessarily fatal. If the meetings were just big wastes of time, as too many tend to be, the

During a hyper growth phase the important thing about human resources is to bring in and keep superstars and ruthlessly cull anyone who isn't for any position that isn't basically administrative or infrastructure. You don't want someone merely good when you can try for someone who is amazing, especially when you are trying to completely dominate what you imagine to be a huge marketplace.

Once the company is firmly established then you can take people who are merely good and work on getting them to up their p

Indeed. I have no idea who this person is, yet having read his post, I am now convinced that he missed out on a bigger lesson.

My take-away thoughts: if I'd lost out on $100 million in stock options, I'd probably be fairly pissed as well. And his arguments are kind of backwards / contradict themselves: what he's really saying is "don't be replaceable -> work on as much of the core product as possible, as opposed to trying to be 'friends' with everyone around the office, as being the company dandy won't sa

That's right! There are millions of people who will tell you, with a smirk, that you suck. They aren't doing it for you. Their criticisms aren't constructive. They're trying to get ahead, and if they can get ahead of you by convincing you that you really do suck, they'll do it. Bullying doesn't end when childhood ends.

The guy's basically a marketing manager. You might be the smartest person in company, but if a glorified salesman is all you are, you can easily be cloned. The exception is if you developed enough good connections OUTSIDE the company that you can take a shitload of the client base if they fire you. I don't think this is the case with Facebook users, fake or otherwise.

Of course, marketing types get paid more than the typical engineer if the product is successful. But if you want a more stable job, it's better to be the craftsman working at the product, than the pretty face selling it at the counter.

Hmm, I'd imagine sales would be more high pressure. Marketing requires outsourcing demographic studies and ensuring that you attract some attention without offending anyone. Sales requires reading people / their reactions with split timing, and being able to close a deal.

Marketing is filled with the 'beautiful people,' and Sales is filled with the people who give off the oddball wavelength that you can 'trust' them, or when that fails, that you're still getting a 'deal' out of the proposed arrangement.

It's a familiar story. I worked with a guy who interviewed at a certain small software company back in 1982, and refused their offer because he thought their CEO was an insufferable dork. And of course that dork's name was Bill Gates.

Another bunch I worked with on a skunkworks startup had been with a certain other Big Name back when (this one I have to keep to myself) and just barely missed out at cashing in when they got bought out. The whole point of the startup they had brought me in on was to try and recreate that magic moment they had missed the first time. And of course the startup's product was hopeless, since all it's motivations were the wrong ones.

Which kind of demonstrates the stupidity of the whole approach. I don't mean the obsession with might-have-beens (though that's pretty unhealthy). I mean the obsession with getting rich by being part of The Next Big Thing. Unless you're a fucking genius (and trust me, you're probably not), you're not going to invent something really brilliant, and that's the only sure way of cashing in. Otherwise, you're just rolling the dice. OK, you roll the dice every time you start a business. But to have any hope of succeeding, you have to be focused on the the basics of making your company work, not crapshoot aspects, which are simply beyond your control.

I'm not saying that nobody ever lucks out and gets big bucks. But it's just not something you can plan. If you want to gamble, buy a lottery ticket: the odds in your favor are just as good, and it'll screw up your career a lot less.

Not all startups invent something brilliant, and it certainly doesn't require to be a genius to get big bucks.
A decade ago I worked for a startup that developed a better product than its competitors (evolutionary, not revolutionary). It had a slightly better engineering team, more effective sales force, and more nimble org structure than its closest competitors. As a result, it went public in 2000 and got acquired in 2004. Founders and most of early employees got big bucks. Well, certainly not billions, b

Not all startups invent something brilliant, and it certainly doesn't require to be a genius to get big bucks.

I didn't say genius was required to get big bugs. I said that genius was required to make it a certainty.

From your description, that startup you worked for was a well-run company that managed to build some solid value. Now there's no denying that this is the right way to build a good business. And of course well-run companies have a better chance of winning the fat buyout crapshoot. But the crapshoot is still a crapshoot.

My only point here is that if you focus on winning the crapshoot, you almost certainl

I don't know the guy from Adam, but Kagan comes across as a bit of a douche. His lessons learned:

1- Selfish. I wanted attention, I put myself before Facebook. I hosted events at the office, published things on this blog to get attention and used the brand more than I added to it.
Lesson learned: The BEST way to get famous is make amazing stuff. That’s it. Not blogging, networking, etc.

How about this lesson: be a little less superficial and worry about something besides getting famous.

2- Marketing. The marketing team’s plan was not to do anything and the night before we opened Facebook to the professional market (anyone with a @microsoft.com, @dell.com, etc) I emailed TechCrunch to let Michael Arrington know to publish it in the morning. He ended up publishing it that night (I was at Coachella and will never again attend) before the actual product was released in the morning. I immediately notified the e-team and assumed full responsibility.
Lesson learned: I don’t think what I did was that wrong since the marketing team did not do anything to promote our new features. My lesson learned was more I should have involved them instead of just going around them.

Two lessons not learned: discretion and the ability to abide by someone else's decision when you disagree.

Anyone else notice that the comments on his page are disabled. A whiny asshat bitches that he sucked and got shit-canned, and he ends up afraid of what people might say on his blog about it. Yeah, that's being "brutally honest" and manning up to it.

You are NOT special and there is guaranteed someone better than you on this planet.

First, sure you are special. Everyone, best or otherwise, bring something different to anywhere they work at (unless it's a soul crushing place). Yes, there is guaranteed to be someone better than you on this planet (well, there is a 1:7,000,000,000 chance there isn't). If, however, you are one in a thousand, the company is highly unlikely to find those better people.

To summarize my comment so far: You are special, and it is possible that the company cannot get any better than you. You are still replaceable.

Yes, your replacement will not be as good as you are. They might cost more (at least when amortized over the time it takes them to complete a given task). They might not be as organized as you. They might turn out inferior solutions. At the end of the day, however, they will get the job done.

1. First job, not even out of college, I got sucked into a marketing firm that was doing... okay... And I invested time (a lot) to make things going from ok to profitable. I n exchange I was supposed (no contract... I was naive) to inherit 50% of company. I even worked over 100 hours per week sometime, no overtime charged, only vacation 1/1. All that just above minimum wage.

2. I changed jobs 10 years after because the first company got bankrupt. But at that point I was exhausted, as in depression exhau

I just opened to the community... and I will have to live it through. Good for me I am stronger now, but no, I will not have an employee discount. Point was, he is probably not that bad in life as I, or many other people, went through. I even have the courage to Slashdot it using my login name...

Being employed in factory when you are used to have direct access to the big boss is not an easy thing to do. Please, be respecful to those who open up.

...and not whether the guy is an asshole, but (a) he is an asshole and (b) what the hell WAS the lesson? This dipshit can't put together a coherent thought. To wit:

Lesson 1 is not only wrong, it's uninformative. A company gets famous by making a fabulous product? No s**t. Or was it that a person gets famous by making a fabulous product? But he's a manager, not a creator. Did he mean he figured HE could get famous by... managing... a fabulous... product? F**k it, I'm done with that one.

Lesson 2 insists in two consecutive sentences that he shouldn't have gone around the marketing guys, but what he did (i.e., go around the marketing guys) wasn't wrong. So, it's not wrong. But he shouldn't have done it. F**k it, I'm done with this one, too.

Lesson 3 is that you need to see if your weaknesses are hindering your ability to do the job. That's... a lesson he needed to learn? Did he also learn that he needed to put on pants when he left the house in the morning? Who IS this idiot?

The guy actually admits that he thought the company missed him after firing him, like Facebook (even in its early days) was some high school s.o., pining away for him. You're kidding, right? Who the hell has that kind of sense of self importance, especially a guy who, by his own admission, wasn't one of the driving forces at the company? I love that he actually follows this up with the insight that "everyone is replaceable." In fact, most people (but not all) are replaceable. Most of the people who are replaceable are business types who specialize in bureaucratic process control... like this dope. The creative types... less replaceable, depending on their skill and originality.

Seriously, he talks about how he just wants to focus on the job instead of, you know, self-promotion, but here is bloviating on the internet about his "insights," all of which would be old news to anyone with emotional and intellectual maturity of a sixteen year old.

I presume the $100 million figure comes from stock options, and not from salary or personal investment. However anyone who has been watching the facebook stock (and smart enough to not buy it) knows it has been dropping rapidly; already less than half its IPO price. Being as employees are still not allowed to sell their shares, you can't say the employees have made anything off of the stock values yet.

We'll see what its worth when employees start to cash out - or if it survives that happening.

I suspect that/. might be selling him slightly short - after all, he says he was promoted a while before that.
What I suspect happened is that he was a fine worker where he was, and someone up thought of promoting him. What resulted was him peacocking as he admits, and not being of particular use at his new place, even creating fuckups. Well, they couldn't quite demote him again because he'd read it as being a stop to his career and would leave anyways, not doing much in the meantime - the logical, if nasty option was to show him the door as unexpectedly as possible.
The actual lesson is: getting promoted doesn't mean you have everyone in your pocket yet.

"It would suck?" It's pretty hard to lose 100 million unless you have it. So, he had more than most people make in a lifetime, and even got to enjoy it for a while before he lost it. He was lucky enough (this kind of money doesn't just come from hard work and talent, people) to have a taste of something that other people can't even begin to dream of, and now he lost it? Boo fscking hoo.

"It would suck?" It's pretty hard to lose 100 million unless you have it. So, he had more than most people make in a lifetime, and even got to enjoy it for a while before he lost it. He was lucky enough (this kind of money doesn't just come from hard work and talent, people) to have a taste of something that other people can't even begin to dream of, and now he lost it? Boo fscking hoo.

I really wish people would get over this ridiculous "I hate jews" crap. You literally cannot hate an entire category of people regardless of how precise you are about it. And "jews" (kikes if you must) is an extremely imprecise categary.

I *want* to hate the jews. I really do. Convenient to blame problems on. And we've got lots of them. We've got the money systems. We've got wars. We've got victims being victimizers and lots and lots more. But with few exceptions, every jew I have known personally, I